Resources | Market Trends | September 20, 2023

Artificial Intelligence for Business: 5 Ways to Leverage AI for Growth

A technology once thought to be only in the domain of leading large enterprises is now helping small to midsize businesses fill resource gaps, innovate and grow.

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In the past five years, the use of artificial intelligence (AI) has more than doubled — the benefit being that the technology is no longer exclusively accessible to large enterprises but to businesses of all sizes. About 40% of small businesses now actively use AI to facilitate operations, and demand for AI in small to midsize businesses (SMBs) is expected to continue growing.

As an SMB, you might have been reluctant to adopt artificial intelligence for your small business until now, with concerns about the cost and implications for employees. Fortunately, AI’s growth means that it is becoming increasingly embedded in everyday software and tools, making it easier to integrate it within core business processes. Additionally, AI can replace redundant, repetitive, unsafe tasks, or those that can’t physically be done at scale by humans. Combined, these factors are delivering a significant return on investment (ROI), enabling small and large businesses alike to use resources more efficiently and redirect staff to more creative and meaningful roles.

Beyond these benefits, AI is helping small businesses scale and compete against bigger companies, improve customer satisfaction and retain employees. According to a 2022 Deloitte survey, 82% of employees believe that AI would enhance job performance and satisfaction.

Smaller businesses generally have fewer resources than larger companies and, as a result, stand to benefit from AI. This article covers five different AI business trends that are changing SMBs — but first, what exactly is artificial intelligence?

What is artificial intelligence?

Before diving into the trends, it helps to define what AI means. “Artificial intelligence” is a general term that describes the use of computer software that is developed to exhibit humanlike behaviors such as problem-solving, creating, planning and learning. There are several different approaches under the umbrella of AI. Some of the most common methods include:

  • Machine learning. Machine learning techniques process large volumes of data to train algorithms over time for specific tasks. Businesses now ingest overwhelming amounts of data — so much that humans alone can’t analyze it comprehensively and accurately. Machine learning allows businesses to make sense of this data efficiently, identifying patterns and insights that can support smarter business decisions.
  • Natural language processing (NLP). Natural language processing is a form of AI that is trained to understand and respond to human language. NLP technologies can analyze sentiment in text, perform translation and transcribe speech. For businesses, natural language processing is often used to develop chatbots and personal assistants that aid both customers and employees. 
  • Deep learning. Deep learning builds on machine learning, building neural networks — mirroring the human brain — to interpret and respond to complex environments. Unlike machine learning, which can peak in performance after ingesting a certain amount of data, deep learning networks learn continuously, becoming more skilled over time. For example, deep learning is often behind advanced solutions such as fraud detection or autonomous vehicle driving, where several inputs must be interpreted simultaneously. 
  • Robotics. Manufacturing businesses benefit from AI-based robotics, which are developed to manipulate physical objects. Robotics can be used in place of repetitive physical labor, making manufacturing processes more efficient and keeping workers safer when dangerous equipment is involved.

5 business ideas for artificial intelligence

Interpreting data at scale is at the core of AI’s value for small businesses. Here are some of the many ways small businesses are using AI to evolve.

1. Customer management, sales and marketing

You might already use a customer relationship management (CRM) system to plan and track marketing, sales and customer interactions. Leading solutions use artificial intelligence to automate some of these processes while making insights more accessible. For example, NLP and machine learning models — including generative AI — can help your business:

  • Give customers personalized, around-the-clock support and product demos through chatbots and virtual sales agents.
  • Quickly create targeted customer emails, ads and marketing content.
  • Analyze patterns in buyer behavior. This can illuminate customer sentiment, forecast demand and provide campaign performance insights.

Some CRM solutions offering these capabilities include Salesforce’s Einstein GPT and Hubspot’s ChatSpot.

2. Cybersecurity

COVID-19 forced businesses to adapt many business processes, and cybersecurity is no exception. Cyber risks continue to increase globally year after year, with attack volumes up 7% in the first quarter of 2023 compared to the same period in 2022.

However, small businesses are behind when it comes to cyber defense: 1 in 3 SMBs use free cybersecurity software and 1 in 5 fail to use any endpoint security. It’s no surprise then that small businesses are three times more likely to be targeted than larger enterprises that have the resources to invest heavily in protecting digital assets against ransomware, phishing, malware, data theft, social engineering and insider risks.

Cybersecurity tools process a constant stream of data, generating high volumes of alerts — many of which are false positives. Even if you have robust security software, your SMB may lack the human resources needed to keep up with data analysis and triage. Artificial intelligence makes this task more manageable by identifying, analyzing and triaging potential threats early. For example, machine learning and deep learning models can spot anomalies in customer behaviors and uncover patterns in internal systems data that indicate a vulnerability. Some solutions may even remediate the problem or suggest fixes.

3. Supply chain management

The pandemic, geopolitical conflict and environmental disruptions are prompting businesses to rethink supply chain resilience. Artificial intelligence for business enables smaller companies to improve supply chain visibility for more strategic, agile decision-making. Data from your enterprise resource planning (ERP) software, Internet of Things (IoT or smart) devices and suppliers’ activities can all be leveraged. For example, your supply chain department can use AI to:

  • Manage inventory. Machine learning techniques can evaluate current and historical data such as demand and lead times. With this information, AI systems can help your business predict shortages and suggest optimal inventory plans. This functionality is offered by tools such as Netstock and AWS Supply Chain.
  • Automate physical processes. AI-powered robots designed to automate manufacturing tasks can support supply chains that are under-resourced, pose worker safety risks or require tasks humans can’t do efficiently at scale. Robotics technologies are becoming more advanced, with providers developing solutions that are more accessible and affordable for SMBs.
  • Develop more strategic supply chains. By connecting insights from different points along the supply chain, artificial intelligence can identify areas for improved efficiency and resilience. This could include locating alternative suppliers, using a nearshoring strategy or finding ways to optimize working capital.

4. Software development

For some businesses, off-the-shelf software is insufficient for managing data. Depending on your business’s requirements, you may need to develop proprietary applications to handle data and manage other business processes more efficiently. However, software development is costly, and many SMBs lack the budget or expertise to develop bespoke functionality.

Enter Software 2.0, an approach that uses artificial intelligence to make software development easier for different user levels. If your business has limited (or zero) development talent, no-code software allows users to develop and customize applications without needing to write a single line of code. Low-code software works similarly, catering to employees with basic coding experience.

5. Finance and accounting

Your business most likely performs repetitive financial tasks, such as bookkeeping, managing accounts receivable and reporting. Fintech companies are developing a variety of AI-based tools that automate some of these basic accounting tasks, making your accounting team more efficient and reducing errors. Artificial intelligence also supports more complex financial processes, such as identifying fraudulent activities, generating reports and assessing creditworthiness. Domo is one example of a tool that can forecast your metrics and integrate businesswide data for financial planning.

If your company needs to optimize working capital and strengthen cash flow, artificial intelligence for business can support that, too. For example, many businesses and their suppliers are adopting dynamic discounting — an innovative working capital solution that uses AI technologies to facilitate early invoice payments in exchange for a buyer discount.

Some fintech providers in this niche use machine learning to evaluate which early payment opportunities give optimal returns based on market activities. This allows businesses to use invoice discounts strategically — that is, when they are more likely to be approved and when they are competitive against alternatives such as supply chain financing and business loans. Partnerships between early payment program providers and AI fintech, for example, C2FO and Vic.ai, are modernizing the invoice discounting model to make funding more accessible and inclusive to businesses of all sizes.

The bottom line on artificial intelligence for business

Advancements in artificial intelligence are making techniques such as machine learning more accessible to SMBs in terms of cost and ease of implementation. These solutions can assist in almost any business function that uses or generates data, from sales and marketing to working capital optimization. If your business has the funds to invest in growth, consider AI as a way to improve efficiency, boost customer satisfaction and strengthen employee retention. 

Learn more about innovative business solutions such as dynamic discounting and early payment programs.

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